Traders work on the floor of the New York Stock Exchange in New York City.
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U.S. stock futures traded lower on Wednesday. The action comes after a sharp decline in Big Tech stocks and renewed fears over the path of rate cuts spurred a sell-off on Wall Street.
S&P 500 futures were down 0.3% while Nasdaq-100 futures slipped roughly 0.4%. Futures tied to the Dow Jones Industrial Average fell 84 points, or 0.2%.
Futures appeared to take a leg down earlier after CNN reported, citing sources, that President-elect Donald Trump is considering declaring a national economic emergency to push through new tariffs.
Palantir, one of the biggest gainers in the S&P 500 last year rising more than 340%, was down for a third straight day in the premarket, losing 3%. Chipmaker Advanced Micro Devices shed nearly 3% after a downgrade by HSBC.
Investors are now looking ahead to the ADP private payrolls report and jobless claims data, both due Wednesday morning. Minutes from the Fed’s December meeting are slated for release at 2 p.m. ET.
Stocks are coming off a rough trading session, as the major averages finished solidly in the red following fresh economic data showing greater-than-expected expansion in the U.S. services sector, per the Institute for Supply Management’s services index.
The ISM reading showed an increase in prices on the month, fanning concerns around stubborn inflation and questions around this year’s trajectory of interest rate cuts from the Federal Reserve. According to the CME’s FedWatch tool, markets are currently pricing in a 95% chance of no reductions at the central bank’s meeting this month.
Bond yields, which have been climbing on bets that Trump’s tariff and tax plans could lead to a spike in inflation, rose on the data. The rate on the benchmark 10-year note was recently above 4.7%, near levels last seen in late April.
Ayako Yoshioka, a portfolio consulting director at Wealth Enhancement Group, thinks the positive story for the market is still intact for 2025, however, even if the path to “decent” returns is more volatile.
“We have so many different crosscurrents, whether it’s on the growth side, the inflation side, policy changes,” Yoshioka said Tuesday on CNBC’s “Closing Bell.” “Those are going to probably rattle markets at times, but I think they’re going to be overall just buying opportunities in the long term.”
